Say no to shore-side charging tax

Ship & Boat International: eNews October 2018

The European Parliament’s Transport Committee (TRAN) has voted to remove existing tax barriers for the uptake of shore-side/port-side electricity by vessels – a move that could well boost the further development of electrified ships and boats across the continent.

Although vessels have been able to avoid these taxes by generating electricity onboard, using energy sourced from their own marine fuels, ships at berth have traditionally incurred electricity-related taxes when hooking up to port-based chargers.

It is hoped that, by removing these shore-side tax restrictions, vessels and ports can be encouraged to embrace electric power. For instance, Isabelle Ryckbost, secretary general of the European Sea Ports Organisation (ESPO) (pictured, above right), said, in late September, that the additional, tax-related costs of recharging in port meant that such charging facilities tended to be “underused”.

Some European countries have already taken the lead and have had their individual, national exemptions accepted by the European Commission. For example, the tax rate in Germany has been cut to €0.50 per MWh, whereas, before the reduction, the rate was €20.50 (US$23.70) per MWh. In Sweden, meanwhile, the decision to slash the tax rate from between SEK185-293 (US$20.50-32.50) to SEK50 (US$5.54) per MWh marks a comparable decrease. However, Denmark would appear to have undergone the most drastic reduction in its shore-side charging tax rate, which has plummeted from DKK878 (US$135.84) per MWh to a mere DKK4 (US$0.62). The current Swedish and German tax rates are set to last until mid-2020, while the Danish taxes apply until June 2021.

Ryckbost added: “A permanent and European tax exemption for shore-side electricity at berth would enhance its uptake, allowing ports and their surrounding communities to reap the environmental benefits of these costly investments.” She cited cleaner air quality and reduced noise of ships at berth as obvious benefits of this strategy. “We now hope the message also reaches the [European Commission], the national governments and the ministers in charge of taxation issues,” she opined.